| Bonds & Fixed Income |    673 VIEWS  |
| Bonds & Fixed Income | |
| 673 VIEWS | |
 | |
| PROSHARE | |
| PROSHARE | |
Tuesday, October 27, 2020 / 9:52 AM / by Zedcrest Capital / Header Image Credit: Spring News
The FGN Bonds market opening
session for a new week was met with a flurry of supplies, as demand slowed at
the tail of the bond curve despite the bond coupon inflow that hit the system.
Although demand for short and mid dated bonds remained very healthy, market
appetite waned slightly for 2049s and 2050s which has been most-sort after
bonds in recent time. The market quote opened the day at 7.00%/6.90% but jumped
by approx. 32bps to close the day at 7.35%/7.20%. We also witnessed early
morning interest in 2034s, 2036s, and 2037s papers as most market trades
settled around the 5% levels for these maturities. By mid-day, we saw market
activities snooze closing the day on a quiet note.
We expect the demand sentiments to stay low
for the week fueled by the recent CRR debit that took out the majority of
market liquidity.
|
Benchmark FGN Bonds |
||||
|
Description |
Bid (%) |
Offer (%) |
Day Change (%) |
|
|
16.39 27-Jan-22 |
4.69 |
1.02 |
2.57 |
|
|
12.75 27-Apr-23 |
5.38 |
0.97 |
2.63 |
|
|
14.20 14-Mar-24 |
5.92 |
1.18 |
3.24 |
|
|
13.53 23-Mar-25 |
3.03 |
1.33 |
0.00 |
|
|
12.50 22-Jan-26 |
3.52 |
3.20 |
0.06 |
|
|
16.29 17-Mar-27 |
4.08 |
3.09 |
(0.14) |
|
|
13.98 23-Feb-28 |
4.09 |
3.55 |
(0.24) |
|
|
14.55 26-Apr-29 |
4.13 |
3.46 |
(0.20) |
|
|
12.15 18-Jul-34 |
5.18 |
4.78 |
(0.13) |
|
|
12.40 18-Mar-36 |
5.24 |
4.80 |
(0.06) |
|
|
16.2499 18-Apr-37 |
5.25 |
4.91 |
(0.02) |
|
|
14.80 26-Apr-49 |
8.00 |
6.85 |
0.85 |
|
Treasury Bills
The OMO
bills market resumed the week bullish, as demand from local banks persisted
despite the measly level of system liquidity. The appetite for mid-and
long-dated bills remained undented as few trades sealed on April/July bills
settled around the 0.40% levels.
The NTB
space witnessed slight movement especially for the Sept bills which gained most
of the market traction.
We expect
this demand to be sustained for the week, despite the low system liquidity
which is expected to turn by mid-week when OMO maturities of N336.09BN and Bond
coupon of N46.92BN hit the system.
|
Benchmark OMO Bills |
|||
|
Description |
Bid (%) |
Offer (%) |
Day Change (%) |
|
NGOMO
11/03/2020 |
1.00 |
0.01 |
0.00 |
|
NGOMO
12/01/2020 |
1.00 |
0.75 |
0.00 |
|
NGOMO
01/05/2021 |
1.00 |
0.01 |
0.00 |
|
NGOMO
02/02/2021 |
1.00 |
0.01 |
0.00 |
|
NGOMOB 0
03/02/21 |
2.00 |
0.01 |
0.00 |
|
NGOMOB 0
05/11/21 |
2.00 |
0.01 |
0.00 |
|
NGOMOB 0
08/10/21 |
2.00 |
0.01 |
0.00 |
|
NGOMOB 0
09/07/21 |
2.00 |
0.01 |
0.00 |
|
NGOMO
11/03/2020 |
1.00 |
0.01 |
0.00 |
|
NGOMO
12/01/2020 |
1.00 |
0.75 |
0.00 |
|
Benchmark NTBills |
|||
|
Description |
Bid (%) |
Offer (%) |
Day Change (%) |
|
NIGTB
11/12/2020 |
1.00 |
0.01 |
0.00 |
|
NIGTB
01/14/2021 |
1.00 |
0.01 |
0.00 |
|
NIGTB
01/14/2021 |
1.00 |
0.01 |
0.00 |
|
NIGTB
02/11/2021 |
2.00 |
0.01 |
0.00 |
|
NIGTB
04/29/2021 |
2.00 |
0.01 |
0.00 |
|
NIGTB 05/13/21 |
2.00 |
0.01 |
0.00 |
|
NIGTB
06/10/21 |
2.00 |
0.01 |
0.00 |
|
NIGTB
07/01/21 |
2.00 |
0.01 |
0.00 |
|
NIGTB
08/26/21 |
2.00 |
0.01 |
0.00 |
|
NIGTB
08/26/21 |
2.00 |
0.01 |
0.00 |
|
NIGTB
09/09/21 |
2.00 |
0.01 |
0.00 |
|
NIGTB
11/12/2020 |
1.00 |
0.01 |
0.00 |
|
NIGTB
01/14/2021 |
1.00 |
0.01 |
0.00 |
Money Markets
The market opened from a large
downslide in system liquidity following the huge CRR debit of over N800BN by
CBN to commercial banks. The market opened the week with c.N100.73BN positive
in system liquidity while OBB and OVN rate over around 6.00% and 6.25% levels
respectively.
We expect the market rate to
coast around this level tomorrow as the market doesn't expect any major funding
requirement.
|
Money Market Rates |
||
|
|
Current (%) |
Previous (%) |
|
Open Buy Back (OBB) |
6.00 |
9.00 |
|
Overnight (O/N) |
6.25 |
9.75 |
FX Market
The
interbank IEFX window opened the week on a quieter note, with traded volumes
down by 81% ($37.23 m). The range of traded rates stayed wide trading in the
highs of N393.11 and lows of N382.00/$ but slightly tighter compared to Friday
while its closing rates remained unchanged at N386.00/$.
At the
Cash and Transfer window, we saw slight activity although still trading at
different levels staying wide at N15.
|
FX Market |
||
|
Current (N/$) |
Previous ( N/$) |
|
|
CBN Spot |
379.00 |
379.00 |
|
CBN SMIS |
380.69 |
380.69 |
|
I&E FX Window |
386.00 |
386.00 |
|
Cash Market |
460.00 |
459.00 |
|
Transfer Market |
475.00 |
473.00 |
Eurobonds
The NIGERIA
Sovereigns opened the trading week with little changes/activity
recorded. Yields on the sovereign curve weakened by a single basis point, as
sentiments towards the papers aligned with another consecutive session of lower
global oil prices dropping below $40 per barrel. (BRENT dropped by 3.32% to
close at $38.46pb).
Related News
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WoW to 0.4%; PMA to Hold on Wednesday
2.
More FGN Pro-note
Issues to Come
3.
Moody's Withdraws
Green Bond Assessments
4.
Nigerian Breweries
Plc Series 9 and 10 Commercial Paper Now Open
5.
A Clear Winner from
Crashed Bond Yields
6.
Summary of FGN Bond
Auction Results for October 2020
7.
CBN Cuts OMO Rates
by 37bps Staying True to Their Stance
8.
Coronation MB
Funding SPV Plc's Up to N10bn Series I Bond Issuance Now Open
9.
Land-sliding Drop-in
Bond Auction Stop Rate as DMO Cuts Rates by Approximately 200bps
10.
Local Appetite for
Bonds Continues to Weight Yields Down
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